Orchestrating Compliance - Pharmaceutical Executive

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Orchestrating Compliance
Product managers are not always happy to see their compliance officers. That may be changing.


Pharmaceutical Executive


Although Maine has delayed its initial report due date until 2007, state laws from Vermont, Minnesota, West Virginia and the District of Columbia must be complied with, despite some states (WV, DC) not yet defining their reporting periods. For some states, this will involve reporting expenditures to physicians, including gifts. Pressure against allowing gifts to physicians is also being exerted by the American College of Physicians, whose Ethics Manual recently claimed, "The acceptance of individual gifts, hospitality, trips, and subsidies of all types from the healthcare industry by an individual physician is strongly discouraged. The acceptance of even small gifts has been documented to affect clinical judgment and heightens the perception (as well as the reality) of a conflict of interest." With increasing political and industry pressure, policies and procedures will need to be revised, relevant staff trained, and regular auditing conducted to ensure that policies are being adhered to. Companies may consider establishing a specific department or group to handle the increasingly demanding state-law requirements, similar to departments established to handle government pricing.

4. CLINICAL TRIALS
There are multiple issues brewing in clinical trials. The most widely discussed is the issue of publication of clinical-trials data. Again, there is combined political and industry pressure in this area. The federal and various state governments are looking at the publication of clinical-trials data. As of July 2005, Congress has a Fair Access to Clinical Trials Act pending, and at least sixteen states introduced bills related to clinical trials in the 2005 sessions, three of which have passed (IL, ME, VA). Additionally, the International Committee of Medical Journal Editors (ICMJE) took action in September 2004 by declaring that none of the 11 publications they represent would publish any articles discussing clinical trials that were not registered. ICMJE published guidance on the issue, in May 2005.

While there are multiple potential avenues of publication available—corporate Web sites ( http://www.lillytrials.com/) or government Web sites ( http://www.clinicaltrials.gov/)—many questions remain unanswered. Pharmaceutical companies will have to decide what data they are going to publish, when, and where. The compliance officer must ensure that any policies currently in place relating to clinical trials and publication of clinical-trial data are updated as necessary. For example, publications budgets should be moved from marketing to medical, or an independent part of the organization (similar to grants), in order to avoid the implications of a conflict of interest. Financial and authorship disclosures must be robust and transparent, and include acknowledgements for contributions (editorial or other) from any pharmaceutical companies, and financial support, both to vendor and author. This will involve updating current policies and procedures, and offering training to publications' committees and vendors—for example, on the ICMJE guidelines.

5. PRICING
While government pricing and managed markets have always been major compliance risk areas, the initiation of the Medicare Part D prescription-drug benefit, which begins on January 1, 2006, will add further complexity to this area. The usual suspects of anti-kickback, false claims, and conflict-of-interest all play a role. Risk areas, such as contracting with PBMs, reimbursement support, patient assistance programs, and relationships with purchasers and formulary-committee members, will all come under more scrutiny. Compliance officers will need to be vigilant and ensure full compliance with their policies and procedures, update them if necessary, and train and educate appropriate staff on compliance issues related to the program.

6. DTC ADVERTISING
DTC advertising has been in the regulatory spotlight since its emergence as a major pharmaceutical-industry marketing vehicle. After several recent developments, this spotlight seems to be shining even brighter. In early June, citing changing consumer sentiment, BMS pledged not to promote any of its drugs with DTC in their first year after launch. Later that same month, Senate Majority Leader Bill Frist (R-TN) called on pharmaceutical companies to voluntarily restrict DTC advertising for two years after a drug is approved by FDA. Frist's statement has been met with opposition from the Washington Legal Foundation (WLF) and others, based on First Amendment concerns.

PhRMA recently established a set of voluntary DTC communications guidelines. It's clear that each company's position on DTC must be examined, and policies will have to be rewritten. New strategies might have to be considered for product launches, and the compliance officer will play a pivotal role in creating timely awareness and educating the brand teams. In addition, based on possible new guidelines and public opinion, and competitive pressures, the compliance officer might anticipate DTC changes and develop policies for the marketing teams.

7. INTERNATIONAL COMPLIANCE
Pharmaceutical companies can expect continued enforcement of the Foreign Corrupt Practices Act (FCPA) by the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ). The SEC has prosecuted several US pharmaceutical companies for violating the FCPA in Germany, Poland, and Italy. In addition, the DOJ has invoked the anti-bribery provision of the FCPA as it prohibits offering payments to foreign officials. Gifts to a physician working for a hospital in Germany are considered bribes to a foreign official because the German government employs physicians working for hospitals in Germany.


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